Agriculture Groups Respond to USMCA Signing

USMCA Agreement Important Relief for Agriculture

The following statement can be attributed to American Farm Bureau Federation President Zippy Duvall: “Today’s signing of the U.S.-Mexico-Canada Agreement continues the progress American farmers and ranchers have made since the North American Free Trade Agreement took effect in 1994.

“Agricultural exports to Canada and Mexico increased from $8.9 billion to $39 billion under NAFTA. That boost provided important markets for farmers and ranchers whose productivity has only grown since the agreement was signed. USMCA keeps all those gains and adds improvements in poultry, eggs, dairy and wine. In every way, this new agreement is just as good, if not better than, the one that came before. We thank the Office of the U.S. Trade Representative for all the hard work that went into this accord.

“As good as all this news is, farmers and ranchers still face retaliatory tariffs over steel and aluminum disputes with our North American neighbors and other trading partners. We urge the administration to redouble its efforts to come to an agreement on those outstanding issues so we can regain the markets we had not long ago.”

The National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) commended the Trump Administration today for signing the U.S.-Mexico-Canada Agreement (USMCA), which had been agreed to in principle on Sept. 30.

The USMCA will benefit America’s dairy sector by maintaining the overall U.S.-Mexico trading structure of the 24-year-old North American Free Trade Agreement (NAFTA), while incorporating new commitments to strengthen U.S. dairy export prospects throughout the North American region. Thanks to NAFTA, Mexico is currently the largest export destination for U.S. dairy products, accounting for $1.2 billion in sales last year. The United States commands a dominant market share in Mexico, with sales that amount to three quarters of its imported dairy products.

Although the U.S. dairy industry had sought deeper market expansion and stronger disciplines from Canada on dairy, NMPF and USDEC praised U.S. negotiators for their ardent efforts to address Canada’s pervasive trade-distorting practices. The trade deal includes reforms to Canada’s controversial dairy pricing system and some additional market access – key objectives of the U.S. dairy sector.

In addition to Canada-specific dairy provisions, the USCMA broke new ground by establishing a strong sanitary and phytosanitary chapter, as well as numerous provisions aimed at tackling the misuse of geographical indications that erect barriers to U.S. exports of products that rely on common food names.

Industry leaders said the ultimate impact of the agreement, which must be approved by Congress, will depend on how it’s implemented by the three countries. The U.S. dairy industry will engage with both parties in Congress to seek their support for the agreement’s passage while at the same time seeking assurances that Canada will comply with their commitments in a fair and transparent manner.

“The signing of the USMCA gives America’s dairy industry greater confidence as we head into 2019,” said Tom Vilsack, president and CEO of USDEC. “We trust that the administration will aggressively enforce both the letter and the spirit of the agreed upon text. Thus, it is imperative that the United States ensures that Canada implements its commitments in a manner consistent with the hard-fought transparency and market-reforming disciplines secured in this agreement.”

The dairy organizations urged the governments of the three nations to take the next step toward better trade relations by removing currently imposed tariffs on agricultural exports – as well as steel and aluminum – that have been sticking points in relations between the countries.

“We appreciate the Trump Administration for continually raising our issues of concern and fighting for a better agreement with Canada,” said Jim Mulhern, president and CEO of NMPF. “This year has been a challenging one for dairy producers, who are dealing with continuing low prices and the damaging effects of retaliatory tariffs that have already cost them about $1.5 billion. With today’s signing, we encourage the administration to take a fresh look at other tariffs that are hampering North American trade, including the steel and aluminum tariffs still imposed on Mexico, and to continue making progress in striking new free trade agreements and resolving ongoing trade conflicts.”